The fighting is Lebanon's worst internal violence since the 1975-1990 civil war. At least 153 people, including 71 soldiers, more than 50 fighters and 32 civilians, have been killed.

At least 27,000 of Nahr al-Bared's 40,000 residents have fled, mostly to the nearby Beddawi camp, since the fighting started on May 20.

The Lebanese authorities say the fighters must surrender, but Fatah al-Islam has vowed to fight to the death.

Fatah al-Islam emerged late last year after its leader, Shaker al-Abssi, and 200 fighters split from the pro-Syrian Palestinian faction Fatah al-Intifada (Uprising).

Al-Qaeda inspired

Lebanon's Western-backed government says Fatah al-Islam is linked to Syrian intelligence, a charge denied by Damascus and the group itself. Abssi has said he supports al Qaeda's ideas but has no organisational ties to Osama bin Laden's network.

Meanwhile, an explosion in the south Lebanon refugee camp of Ain al-Hilweh killed two people and wounded three others.

Shehadeh Jawhar, a leader of the Jund al-Sham group, was among the injured according to residents.

They said that the two dead men were the shop owner and his nephew. The owner is the uncle of Jawhar, who happened to be in the shop when the explosion occurred, they added.